Liquidating DIA art to pay down debt likely would be a monstrously complicated, controversial and contentious process never before tested on such as large scale and with no certain outcome. The DIA is unusual among major civic museums in that the city retains ownership of the building and collection while daily operations, including fund-raising, are overseen by a nonprofit institution.

DIA Executive Vice President Annmarie Erickson said the museum has hired New York bankruptcy attorney Richard Levin of Cravath, Swaine & Moore to advise ways to protect the collection from possible losses. Levin is one of the nation’s leading bankruptcy attorneys and was active in the General Motors bankruptcy and other high-profile cases.

“We are standing by our contention and belief that we hold the collection in trust for the public,” Erickson said this evening. “And although to some it may seem to be an asset, we do not.”

Bill Nowling, a spokesman for Orr, said the art collection at the DIA must, however reluctantly, be considered one of the city’s assets in the current financial emergency as the city heads toward a possible bankruptcy filing.

“We have no interest in selling art,” Nowling said this evening. “I want to make that pretty clear. But it is an asset of the city to a certain degree. We’ve got a responsibility under the act to rationalize that asset, to make sure we understand what’s it’s worth.”

Gut reaction: I don’t see how a city in as much trouble as Detroit is can justify firewalling its city-owned art. That debt has to be paid by someone. Why shouldn’t the city sell off its paintings and sculptures? Why is that more important to the city than some other publicly owned assets that would have to be sold off? It would be a terrible loss to Detroit, but it’s not like the art would cease to exist; rather, it would go live in institutions around the country.

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57 Responses to Firewalling Art In Detroit

I’m glad I took the time to look back at this. Another thing that is forgotten is that it is likely that a large number of the pieces, possibly even a majority, in question do not belong to the museum at all, but merely have been loaned to it by their owners and therefore cannot be sold as they are actually not part of the assets of the museum. Pieces that were donated may have had some particular stipulations in the donation which would also make sale if not impossible, very unlikely even without direct intervention by the donors. With that intervention the entire process could grind to a halt for decades.

On the other hand it is impossible to feel much sympathy for the creditors. Anyone damned fool stupid enough to loan money to West Mogadishu (I love that, that is now the new name for Detroit) deserves to be left holding the bag.

as and addendum to my post, here’s what Yale is doing with one of their oustanding alums, and their outstanding art gallery….and Bridgeport is certainly not a wealthy place…and has shared similar straits with Detroit over the years….but with interest, guidance, and the price of bus money (or gas)….these kids have a chance.

Rod writes: “but the people who loaned money to Detroit have a right to be repaid, if Detroit can manage that. Some people in Detroit are going to have to take severe hits to pay that debt; why should the DIA be immune? I ask that seriously, not rhetorically. — RD]”

Bondholders, like stockholders are making an educated guess that their investment will be repaid. And when entities enter chapter 11 bankruptcy re-organization, bond holders are above stockholders…because, in part, interest is more important than dividends….

I think legally it would be very, very hard for a work donated to charity (and for which a deduction has been taken) to be sold —with out the proviso I mentioned earlier –that such funds go to specific acquistion funds and similar at the same institution.

There were horrors about the NY Public Library selling gems to Alice Walton—but it was for her new museum. Same with the Stieglitz/O’Keeffe collection at Fiske University…and others.

Collections are not to be leveraged or monetized —without the express agreement of the donor.

Look at the fiasco that Brandeis U. put itself in for thinking it could sell highlights of its collection in the Rose Art Museum….even they recognized that it would take several years to do so, in an up [art] market to make what they wanted to. Thankfully there was an amazingly strong pushback, and the president, and others retired, and the Rose is coming back….(and it was not a drain financially on Brandeis or anyone else; the univ. admin. just saw $$$$).

As many have subsequently pointed out, there are probably donors who provided the art work for the purpose of being available to the public. It probably isn’t available to the city to sell, and it shouldn’t be.

One solution might be a tax on income and revenues generated downtown, by people who pay their property taxes in the suburbs. After all, they do expect police and fire protection to keep them safe at their cushy jobs before they go home in the evening, don’t they?

I have not looked at this blog for several days, so this is the first that I have seen this discussion. Unless I missed it, no one mentioned the anti-democratic nature of the Michigan Emergency Manager law.

Michigan voters repealed the earlier law at the polls in November 2112, largely because of the manner in which it allowed the governor to appoint an emergency manager who could take over control of financial matters from the local elected government. The state legislature responded by passing a new law in a manner which precluded a challenge by referendum. (The new law also calls the appointed official an Emergency Financial Manager instead of an emergency manager.)

In other words, the local citizens have virtually no say in how the situation is resolved. For some odd reason, I would have thought that this merited some notice.

Second, some of the comments reminded me a case that we read in the late Curtis Berger’s property class at Columbia Law School during the 1983-84 school year. (I would cite the case, but I do not have access to the casebook.) In this case, some governmental agency seized a large amount of property in Detroit so private industry could build a large industrial facility. (I believe that it was the auto industry, but I cannot remember.)

If the seizure were to go forward, hundreds of homes and small businesses would be eliminated. The courts upheld the seizure, essentially destroying a stable neighborhood. One of my classmates, who was from Michigan, pointed out that this neighborhood had been a nice contrast to others areas of Detroit, which he termed “a pit.” However, destroying that neighborhood ultimately did not save Detroit’s industrial base, but it did drive tax paying citizens and businesses from the city.

Contrary to some comments above, this action was not due to leftists and radicals. The city or county (or whatever) did it at the behest of industry.

I have an idea. The Federal government could pay what it owes Detroit for saving the country in WW2. We rebuilt most of Europe and Japan, but offered nothing to an American city that suffered massive structural and cultural changes to save America. Since everything is about dollars and cents, Detroit should submit it’s bill for prompt payment.